While drones are being used by cops, border security forces, military and even first responders to an emergency, one researcher has shown that one government-ready drone model can be hacked from over a mile away to be taken control of by a malicious hacker, WIRED reports.

The exploit will be exhibited by security researcher Nils Rodday, showing flaws in the security of at least one government ready UAV. While there is no “easy fix” for the vulnerability, the drone’s manufacturer has been informed.

Rodday, a security researcher by profession and employed at IBM will demonstrate the flaws in the security framework of a UAV that costs anywhere between $30,000 to $35,000. The vulnerability lies in the drone’s radio connection which allowed him to take complete control over the quadcopter. The means to gaining the exploit? A laptop and a cheap radio chip, connected via USB.

The Drone Hack

Although Rodday doesn’t reveal the drone manufacturer or the specific UAV that he tested, the research was conducted at the University of Twente in the Netherlands. The drone, costing up to $35,000 is more expensive than conventional drone because of certain features including longer flight-time, eight rotors as opposed to four or six and the means to carry loads up to 2.9 kgs.

The three-foot wide drone has been deployed by police and fire departments with a flying time up to 40 minutes. Furthermore, it has also been used for inspecting windmills, power lines and aerial photography.

Rodday discovered that the drone’s telemetry module was fitted with an Xbee radio chip. The Wi-Fi connection used between the telemetry module and the user’s application is WEP or ‘Wired-Equivalent Privacy” encryption, a legacy protocol that can be infiltrated in seconds by any proficient hacker. With this alone, an attacker in the Wi-Fi range to break that connection could potentially send a “deauth” command to boot the drone operator off the network and take over.

Notably, the radio chip module converts Wi-Fi commands sent by the app into low-frequency radio waves. These waves are subsequently transmitted to the drone which houses another Xbee chip.

Rodday, armed with the two Xbee chips and a computer, set out to perform the hack.

He initially intercepted the Wi-Fi connection to boot the drone operator. Rodday was then made quick work of cracking the WEP protocol.

Although the Xbee chips had built-in encryption features, they were disabled in order to avoid latency concerns between the operato’s commands and the drone. This left the drone vulnerable to a man-in-the-middle attack.

This additional participant could intercept commands and take control of the drone, without even touching the drone’s command interface or the telemetry control box controlling the drone.

“If you think as an attacker, someone could do this only for fun, or also to cause harm or to make a mess out of a daily surveillance procedure,” Rodday told the publication.

You can send a command to the camera, to turn it to the wrong side so they don’t receive the desired information…or you can steal the drone, all the equipment attached to it, and its information.

The drone’s manufacturer who are now aware of the exploit, only plan on fixing it in the next version of the quadcopter. Amazingly, owners of the drone will be unable to patch the UAV since it cannot be connected to the internet, or be updated with a security patch. Rodday’s former advisor at the university claims that a patch –even if it can be downloaded onto a PC or tablet – is insufficient, calling for the product to be recalled. The security researcher claimed that the only way to truly ensure security while not compromising on latency would be using an extra module specifically for ensuring security for the UAV.

Rodday also claimed that the vulnerability existed beyond this one drone and its manufacturer, as calls made toward other manufacturers about how they secured the Xbee radio protocol went unanswered.

I think this vulnerability exists in a lot of other setups. The impact of the whole thing is bigger than this manufacturer.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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Coincheck Hackers Launder 40% of Stolen NEM Funds, Experts Say

The hackers behind Coincheck’s massive NEM heist have successfully offloaded 40% of the stolen funds, according to new research by Tokyo-based consultancy group L Plus. The successful money laundering campaign highlights the ongoing challenges authorities face in bringing cyber criminals to justice.

Hackers Launder NEM

Analysts at L Plus believe that roughly 200 million NEM tokens, worth $79 million, have already been laundered through the dark web. However, the hackers likely pocketed a much smaller amount amid ongoing efforts to blacklist the tokens.

Nikkei Asian Review reported Monday that Coincheck was targeted with “suspicious traffic” for weeks leading up to the Jan. 26 heist. Citing a person close to the investigation, Nikkei said the attackers hacked an employee email and stole a private key needed to transfer the NEM tokens to the desired accounts. L Plus indicated that the attacker must have repeatedly accessed the Coincheck server to obtain the private key.

When the hack took place, the stolen NEM tokens were worth more than $400 million. Today, they are worth less than half that amount. The identity of the attackers remains unknown to this day. However, authorities have speculated that North Korea may have been responsible for the attack.

Coincheck plans to resume operations this week following a government-mandated freeze on all trading activity.

Japan Boosts Oversight

The attack has prompted Japan’s financial regulators to step up their oversight efforts of the cryptocurrency market. Last week, regulators penalized seven exchanges after deeming their internal controls insufficient to deal with a cyber attack.

The FSA began conducting on-site inspections in late January following the Coincheck attack. Regulators have uncovered several issues, including a lack of customer protection measures and insufficient anti-money laundering controls.

Japan remains one of the most welcoming jurisdictions for cryptocurrency trading, but repeated attacks may prompt regulators to reconsider their relatively lax approach. Digital currency exchanges in Japan and elsewhere face a growing threat from cyber criminals looking to capitalize on the rising value of digital assets.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 226 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.

YEXT: An Invisible Force In Artificial Intelligence

YEXT, Inc. (NYSE: YEXT) is one of those behind the scenes companies involved in Intelligence Search that plays an important role in Artificial Intelligence. What does that mean? Remember the Amazon commercial? “Eco, order a 12” Pizza with pepperoni from Stromboli’s and have it delivered”.

Today the vast majority of online searches go through third-party sources such as data aggregators, governmental agencies and consumers. The net result of this third party sourcing has been to produce “best guess” data that can often miss or misstate the target data field.

YEXT developed a better way to source critical digital knowledge. For example business clients use YEXT to update public facts about their brands. They are building their based on the rapid and ever changing nature of data. So far the YEXT Knowledge Network offers over 100 services to more than 110 corporate clients and has over $150 million in annual revenue. So could YEXT play a key role in AI, the next big thing?

How YEXT Works

Most of us are familiar with big time search engines like Google, Google Maps, Facebook, Instagram, Bing, Cortana, Apple Maps, Siri and Yelp. These pioneering companies are the major drivers in information search today. However, we also know, their accuracy is not exactly ideal.

This is where YEXT steps in. Their knowledge engine platform lets business manage their digital knowledge in the cloud and sync it to over 100 services including the kingpins of search noted above.

Intelligent Search is the structured information that a business wants to make publicly accessible. In food service it could be the address, phone number or menu details of a restaurant; in healthcare, the health insurances accepted by a physician or the precise drop-off point of the emergency room at a hospital campus; or in finance, the ATM locations, retail bank holiday hours or insurance agent biographies.

Artificial Intelligence Offers a Potential $10 Billion Market

Improving search results in general is nice but not very sexy. It doesn’t make you want to beg for more information. However, when you consider the role of Artificial Intelligence (AI) in our evermore data intense world, the importance of Intelligent Search and the opportunities for YEXT becomes a compelling story.

The AI trend is already underway as YEXT is increasingly using the structured data on their platform to expand or add new integrations with vertically specialized applications, voice-based search and AI engines.

Just Right For Big Data Applications

YEXT customers use their platform to manage their digital knowledge covering over 17 million attributes and nearly one million locations. These customers include leading businesses in a diverse set of industries, such as healthcare and pharmaceuticals, retail, financial services, manufacturing and technology.

Management believes the market for digital knowledge management is large and mostly untapped with over 100 million potential business locations and points of interest in the world equaling over $10 billion.

Shooting For Acquisitions and Broad AI Penetration

Founded in 2006 by serial entrepreneurs Howard Lerman (CEO) and Brian Distelburger, President these two are typical software guys whose vision appears much more broad based the their current focus with YEXT. Here is where the prospectus from their April 2017 IPO offers some mystery and excitement to the story.

Unlike most rapid growth tech companies YEXT had no urgent need to go public. They generated almost $60 million in gross profit in 2016 before heavy marketing costs resulted in a loss of $26.5 million. Even so, they still ended the year with $20 million in cash. That’s a fair distance from being destitute.

The company’s real need for the IPO was to establish a liquid public market for the stock. They raised about $123.5 million, all of which will go into the bank. The company is debt free and there are no insiders selling stock. Very interesting.

Strong Financial Results

For the latest reported nine months ended October 31, 2017 revenues grew 38% reaching $122 million. The good news is the gross profits reached a record 75% or $90 million. All of this was spent on sales and marketing to expand the business. When all the beans were counted, YEXT lost $50 million producing a $30 million negative cash flow. The balance sheet remains liquid with $120+ million in cash and securities.

FYI: In spite of some top notch bankers underwriting its IPO and analysts from those same five firms covering the company, the stock has done almost nothing for investors. This $1.1 billion market cap was recently hanging out around $12 about the same as the IPO price.

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Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.4 stars on average, based on 38 rated postsJames Waggoner is a veteran Wall Street analyst and hedge fund manager who has spent the past few years researching the fintech possibilities of cryptocurrencies. He has a special passion for writing about the future of crypto.

Skepticism Grows Over BitGrail’s Supposed $167 Million Hack

A relatively unknown cryptocurrency exchange by the name of BitGrail has informed its users of a coordinated cyber attack targeting Nano (XRB) tokens. However, the incident does not appear to be holding up to scrutiny after the founder of the exchange made an odd request to the developers of Nano shortly after discovering the alleged theft.

BitGrail Exchange Allegedly Compromised

The Italian exchange issued a notice to its clients last week informing them that 17 million XRB tokens were compromised in a cyber attack. The XRB token, formerly known known as Raiblocks, is valued at $9.80 at the time of writing for a total market cap of $1.3 billion. That puts the total monetary loss of the supposed heist at nearly $167 million.

Parts of the notice have been translated into English from the original Italian by Tech Crunch, a media company dedicated to startups and technology news. According to the agency, BitGrail has stated the following:

“… Internal checks revealed unauthorized transactions which led to a 17 million Nano shortfall, an amount forming part of the wallet managed by BitGrail… Today a charge about those fraudulent activities has been submitted to the competent authorities and now is under police investigation.”

The notice indicated that all transactions have been put on hold until authorities complete their investigation.

Very little is known about BitGrail, as it is not listed among the 183 exchanges whose volume is ranked by CoinMarketCap.

Suspicion Grows

Unlike other crypto heists, the circumstances surrounding the alleged BitGrail attack have been met with widespread suspicion. As David Z. Morris of Fortune rightly notes, this isn’t the first time BitGrail has suspended Nano withdrawals. The same thing happened in early January when the exchange halted not only Nano, but Lisk and CryptoForecast transactions as well.

The suspension was followed by an announcement that the exchange was taking measured steps to verify users and enforce anti-money laundering requirements. It was around this time that users became suspicious that BitGrail was going to cut and run with their tokens.

BitGrail founder Francesco Firano made an unusual request to the developers of Nano following the alleged attack: he asked them to fork their record, a move that would essentially restore the stolen funds.

Nano officially rejected the request on Friday, the day after Firano supposedly discovered the stolen coins. In a post that appeared on the Nano Medium page, the team said:

“We now have sufficient reason to believe that Firano has been misleading the Nano Core Team and the community regarding the solvency of the BitGrail exchange for a significant period of time.”

Last month, hackers made off with more than $400 million worth of NEM tokens stolen from Coincheck, a Japan-based cryptocurrency exchange. The coins have yet to be recovered and the perpetrators remain at large. In 2014, a cyber heist brought down Mt Gox, which was the world’s largest exchange.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 226 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.

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